Impact of natural disasters on financial development

Keerthiratne, Wendala and Tol, Richard S J (2017) Impact of natural disasters on financial development. Economics of Disasters and Climate Change, 1 (1). pp. 33-54. ISSN 2511-1280

Full text not available from this repository.


We estimate the impact of natural disasters on financial development proxied by private credit. We employ a panel fixed effects estimator as our main estimation tool on a country level panel data set of natural disasters and other economic indicators covering 147 countries for the period from 1979 to 2011. We find that companies and households get deeper into debt after a natural disaster. This effect is stronger in poorer countries whilst the effect is weaker in countries where agriculture is more important. Accordingly, it appears that natural disasters significantly increase contemporaneous private per capita credit. This impact is mitigated by higher per capita income and further dampened by higher agriculture dependency in the economy. Our findings are robust to alternative estimators, specifications, and samples.

Item Type: Article
Schools and Departments: University of Sussex Business School > Economics
Subjects: H Social Sciences > HB Economic theory. Demography
Related URLs:
Depositing User: Richard Tol
Date Deposited: 19 Apr 2017 07:59
Last Modified: 23 Aug 2017 09:23
📧 Request an update